Tax System


TAX SYSTEM IN PORTUGAL

With your main residence in Portugal, enjoy a sun-filled low-tax retirement !

IMT : PROPERTY PURCHASE TAX (Imposto Municipal sobre Transmissão de Imóveis)

Property purchased on Portuguese soil is subject to property purchase tax (IMT), whatever the buyer’s nationality. IMT is paid by the buyer. Property purchase tax rates vary according to whether the building is in the town or country and if it is in a town on whether the building is a dwelling or not.

Stamp duty: Property acquisition is also subject to stamp duty, which is paid by the buyer at a rate of 0.8% of the transaction price or the VPT (the rateable value), whichever is higher.

 GOLDEN VISA :

New legal provisions have made it possible for foreign investors to request a residency permit designed to attract foreign investment. The Golden Visa programme applies to any person who enters Portuguese territory legally with the aim of transferring funds, creating jobs or purchasing property.

Those holding a residency permit for investments are entitled to:
– bring their families to join them
– access a permanent visa
– obtain Portuguese nationality (optional)

Who can request a residency permit for investments ?

Non-EU citizens making, either personally or through the intermediary of a company, an investment in Portuguese territory for a minimum duration of five years that meets at least of one of the following criteria :

– property investment into assets worth €500,000 or more
– transfer of funds equal to 1 million euros or more (including investments in shares and shareholdings in companies)
– the creation of at least 10 jobs

 

NHR STATUS: NON-HABITUAL RESIDENT


How do you get non-habitual resident (NHR) status ?

– You may not have been a Portuguese resident in the last five years.
– Register as resident in Portugal for tax purposes with the local tax office (for that, you must have stayed in Portugal for more than 183 consecutive or non-consecutive days, or, if you have stayed for less time you need to have been resident at a property on the 31 December of the same year and the situation must indicate that you intend keeping and occupying the property as your main residence).
– Request non-habitual resident status at the same time as you register as resident in Portugal for tax purposes, or before the 31 March of the year following the year you become resident in Portugal.

Comparative advantages of NHR status :

– For 10 years’ tax is fixed at a rate of 20% on the income of natural persons.
(income tax) for any income received for activities in Portugal.
– No double taxation on any pensions or income as an employee or as a self-employed person done abroad.
– A law is anticipated that will create a 17% progressive tax rate.

 

TAX AND FINANCIAL ADVANTAGES

– Lower cost of living, enabling you to optimise your pension and access a higher standard of living.
– Security for your capital thanks to a risk-free investment in property.
– An investment with no exchange rate risk because it stays in the Euro zone.
– Tax agreements between EU countries mean that you avoid double taxation on your income.
You quite simply have your pension paid into your bank account in your country of origin.
– Tax advantages for Portuguese residents (no inheritance tax).

 

EASY LIVING

– A gentle climate and peaceful way of life in diverse landscapes with welcoming people who often know how to speak French and English.
– Many daily flights to major European cities from Lisbon airport at very competitive prices.
– A high standard of living.
– A health system that conforms to European standards and requirements.
– A country with one of the lowest crime rates in Europe.
– A large European community.
– Very little culture shock compared with countries of very different cultures.

 

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